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Early Start with John Berman and Zoraida Sambolin

Boston Police Kill Man With Knife; Report: ISIS Shutting Off Dam; Fifteen Rescued in Chinese Ship Sinking; Obama Signs USA Freedom Act; Obamacare Enrollment Hits 10 Million; One Hundred Thousand Walmart Managers Get a Raise; FIFA President Stepping Down. Aired 5:30-6a ET

Aired June 03, 2015 - 05:30   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


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[05:30:18] JOHN BERMAN, CNN ANCHOR: Terror in Boston, a new arrest after police killed a man that the FBI says has ties to ISIS under surveillance for more than a year. We have new information this morning coming up.

CHRISTINE ROMANS, CNN ANCHOR: Happening now, a desperate search for survivors, time running out as divers try to locate 400 tourists missing in the river, after their cruise ship capsizes. We're live with the latest.

BERMAN: The head of world soccer steps down or is he running away? That's following the widening bribery and corruption scandal now under investigation. We are live with the stunning turn of events.

ROMANS: It really is stunning.

BERMAN: Welcome back to EARLY START, everyone. I'm John Berman.

ROMANS: I'm Christine Romans. It is 30 minutes past the hour. I welcome all of you this morning. Breaking overnight, police arrested one man in Massachusetts and searched a home in Rhode Island.

Law enforcement sources say both are connected to a man the FBI thinks was radicalized by ISIS. A man shot and killed by police in Boston on Tuesday.

Police officials say 26-year-old Usaama Rahim lunged at officers with a foot-long knife. Rahim's family tells a different story. National correspondent, Deborah Feyerick, sorts it out for us.

DEBORAH FEYERICK, CNN NATIONAL CORRESPONDENT: John and Christine, investigators from the Joint Terrorism Task Force have this man on radar and under surveillance most recently around the clock because of what they describe as an alarming uptick in his activity.

Now, he was being investigated for possible threats against police officers. Two members of the Joint Terrorism Task Force approached him early Tuesday morning. They did not have their guns drawn and were surprised when he turned and brandished a military-style knife. Now, they repeatedly ordered the man identified as Usaama Rahim, to drop the knife, he refused and then began moving towards them. That's when police say the two officers fired shots, one hitting him in the torso, another in the abdomen.

Now, his brother is giving a very different account of what happened saying that his brother was simply waiting for a bus to go to work when he was confronted by several officers who engaged him in a conversation.

Apparently, Rahim, according to the brother, made a phone call to the father who actually heard the shots. The brother making that call because he needed, in his words, a witness for what was going on.

Now, authorities say that he wasn't going to be arrested, that he wasn't even going to be taken in for questioning, but they did want to see what he was doing and where he was going. That's why they decided to engage him.

This is now all under investigation. They are surveillance tapes from CVS, where this whole thing happened and those surveillance tapes are going to be shown to local area imams and leaders in the community.

Police questioning two associates, they believe who were in communication with Rahim, they believe Rahim was radicalized online by ISIS and other extremist elements. Right now, all of this under investigation -- Christine, John.

BERMAN: All right, a lot of questions there, thanks, Deb.

Happening now, the Iraqi government is more or less begging for help in its fight against ISIS. In a meeting in Paris at the U.S.-led coalition fighting ISIS, Iraq's Prime Minister Haider al-Abadi, complained that his forces have received more promises than actual support.

Tracking events for us and there are many from Iraq to Syria. CNN's Ian Lee who joins us now. Good morning, Ian.

IAN LEE, CNN CORRESPONDENT: Good morning, John. Yes, let's start on the battlefield in two different areas. First in Syria where we are hearing Islamic state fighters, ISIS fighters are moving north of Aleppo, battling a coalition, a northern alliance of fighters called Levant Front.

This is made up from western-back rebels, as well as Islamists. If ISIS fighters are able to take the northern part, that cuts a vital supply line to Aleppo that runs all the way north to Turkey.

Now the U.S. government has criticized the Assad regime of bombing these rebels that turn aids ISIS fighters advance. The government in Damascus has denied in the past that they're doing anything to aid ISIS.

But we shift now over to Ramadi, where we're hearing reports that ISIS fighters have cut off the water supply from a dam there which has drastically lowered the level of the Euphrates River, which flows to government-controlled towns of Khalidiya and Hamadiya.

And that has created a crisis there as well, but we are also hearing reports that it could be a strategic maneuver by lowering the water supply that allows ISIS to more freely so two updates on the battlefront for you -- John.

[05:35:06] BERMAN: All right, Ian Lee for us and that is what happening in the field. Iraq is asking for flat out more help on the battlefield, help that may or may not be coming anytime soon. Thanks, Ian.

ROMANS: Speaking of help, crews struggling this morning to find new survivors among the 458 people aboard a Chinese cruise ship that capsized in a storm on the Yangtze River, but almost two days after the disaster, the count of people rescued is just 15, just 15, out of more than 400. And hopes are dimming that more can be found alive.

CNN's Anna Coren is standing by with the latest on the rescue and the recovery efforts. Good morning. Anna, there have been so many hopes yesterday that were people maybe would found air pockets in that capsized ship, but time is running out.

ANNA COREN, CNN CORRESPONDENT: Yes, absolutely, as you say, almost two days now since that ship capsized in the Yangtze River and only 15 people retrieved. The chance of finding more survivors is just growing slimmer and slimmer, as the minutes and hours go by.

But certainly that is the priority for the rescue teams onsite. There are hundreds of drivers. There are boats. There are helicopters. They are going through the compartments of this ship. The divers are managing to get inside this ship.

It's four stories, 75 meters long, 13 meters wide, so we are talking about a huge ship. We heard from local authorities just a short time ago, telling us about the challenges that they are facing trying to get inside.

Because we have to remember everything has been turned upside. Furniture has been strewn everywhere. Cords are tangled. Cables are knotted together and then there are also reports that the cabin doors were locked from the inside.

So they cannot get access. This is all taking place in these muddy, murky waters, the visibility for divers is virtually nil. So they are working, you know, blind, really.

But we are hearing, Christine, that they're getting equipment there to raise the vessel so that they can then access the ship and find what sadly will be many, many bodies.

Of course, more than 400 unaccounted for. They're also looking downstream that extended the search going to 220 kilometers. It's an awfully long area, but that is how strong the currents are. That is one of the other challenges that they're facing.

Another piece of information that's come to light, Christine, is that minutes before the boat capsized, it did a sharp U-turn. That took place, and we don't know why, whether it was because of the captain, because of the crew.

Whether it was because of a tornado that struck around that time, we know that a tornado hit the area, lasted for some 15 to 20 minutes. Or whether there was some malfunction. That, of course, is another factor that is being investigated into what went so terribly wrong on the Yangtze River -- Christine.

ROMANS: You can just see the fierceness of that storm as you look at that television video there. Thank you so much for that, Anna Coren.

BERMAN: All right, new this morning, the National Security Agency is losing its authority to store the bulk collection of Americans' phone records. President Obama signed the USA Freedom Act last night following weeks of congressional drama in a 67-32 vote in the Senate.

The compromise bill restores some NSA surveillance programs that expired over the weekend. But within six months, the government will need a special court order to get phone records. And those phone records will now be held bit phone companies, not by the NSA.

BERMAN: Add the Pentagon to a growing list of locations that may have received a shipment of live anthrax. The Pentagon's police force received a shipment of what was supposed to be dead inactive anthrax from a Utah lab, from one of three lots that have now been shown to actually contain live deadly anthrax.

It's believed up to a dozen states and facilities in Canada, South Korea, and, Australia, all got these shipments, some of them via from FedEx dating back to 2007.

BERMAN: More than 10 million people have signed up for health insurance through Obamacare, that is according to the Department of Health and Human Services, that number, though, is in jeopardy or could be depending on a supreme court ruling due later this month.

The vast majority of Obamacare customers depend on federal tax credits to help buy insurance. More than six million people could lose those subsidies if the court rules against tax credits and states that rely on the federal health insurance marketplace.

ROMANS: That ruling is going to be big.

BERMAN: Indeed.

ROMANS: Time for an EARLY START on "Your Money" this morning. European stocks are higher ahead of the European Central Bank's interest rate decision. Investors are also watching negotiations before Greece's Friday deadline. Stock futures in the U.S. are up a little bit. Yesterday stocks dipped down about 28 points.

Walmart, the biggest private employer, in the nation will raise the wages of 100,000 managers by as much as 26 percent. Wages for managers of more complex departments like produce, electronics, auto care, they'll start at $13 an hour and go to almost $25. [05:40:07] Other departments will start at about $11 with wages that go up to $21 an hour. Now Walmart started raising wages at all of its stores to $9 an hour in April. About 500,000 workers will get a raise this year.

The head of world soccer steps down days after re-election and just hours actually after promising he had nothing to do with the widening corruption and bribery scandal. New developments in the case, we'll bring it to you.

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BERMAN: Just days after he was re-elected, a stunning about-face by Sepp Blatter, who announced he is stepping down as the president of FIFA, the governing body of world soccer, so why?

This, of course, comes on the heels of a sweeping indictment alleging corruption at the highest levels of FIFA and it comes as the U.S. Justice Department has confirmed that Blatter himself could be the focus of this investigation.

CNN international sports anchor, Amanda Davies, is live in Zurich this morning. Amanda, wow.

AMANDA DAVIES, CNN INTERNATIONAL SPORTS ANCHOR: Wow, it's been quite a few days, and quite a surprise, yesterday's announcement, as evidenced by the ridiculous number of international media here that are now gathered here on the door step of FIFA HQ.

In a week where I think they were hoping it was going to calm down. But this is such a fast-moving story, John.

[05:45:07] I can tell you that in the last few minutes since I spoke to you, UEFA, European football's governing body have announced that they are have cancelled their meeting planned in Berlin on Saturday.

The meeting of European football's top executives where they were going to discuss what action they were going to take, if any. We're expecting a news conference from South Africa within the next half hour or so responding to the allegations of bribes and corruption around the World Cup 2010.

And later on Wednesday, we're expected to hear from the FBI, around a redacted version of the testimony given by whistle-blower, Chuck Blaser. So I think there will be a lot of interest on this doorstep for many more hours to come today.

BERMAN: All right, Amanda Davies for us. So many questions, thanks for being there. Appreciate it.

ROMANS: All right, let's take a look at what's coming up on "NEW DAY." Chris Cuomo joins us this morning. Happy Wednesday, Chris.

CHRIS CUOMO, CNN ANCHOR, "NEW DAY": Happy Wednesday to both of you.

Authorities have a big headline for us this morning. They shot and killed a man in Boston after they say he charged them with a knife. But more importantly, they say the reason that he was being confronted is that he had been radicalized by ISIS.

Now they are saying this man was under surveillance for years, part of a wider investigation. Officers moved in after reading threats that this man had made against police on social media.

The question is why was he being watched? How closely was he being watched? Because there are some big questions about what changed in this investigation to create the confrontation. We'll take you through it.

We also want to get deeper into this new CNN/ORC poll hot off the presses. How do you feel about the president's job, as a function of what you believe about the economy and what direction the country is moving, and we have some surprising responses in there to unpack -- John and Christine.

BERMAN: Chris, we know you have a sore hamstring, but your news muscle is strong.

CUOMO: Thank you for recognizing the forbearance.

BERMAN: Thank you so much. All right, coming up for us, troubling new details of the TSA's failed security test. How easily replica weapons made it past screeners, really easily. Details, next.

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[05:50:55]

BERMAN: Federal authorities investigating bomb threats against commercial airline flights that were originating or landing in the U.S. This comes on the heels of a scathing report on airport security failures. Let's get more now from CNN's Rene Marsh.

RENE MARSH, CNN AVIATION AND GOVERNMENT REGULATION CORRESPONDEN: Well, John and Christine, bomb threats made against at least four commercial planes with passengers on board Tuesday. A United flight to Chicago, Delta plane to Atlanta, a U.S. Airways flight to Philadelphia, and a fourth plane, after it left Portland, Oregon, headed for Mexico, all targeted.

None of the threats were credible, but law enforcement is now investigating the source. Coincidentally, the series of bomb scares come as we are learning more about TSA failures in detecting prohibited items like weapons at airport checkpoints.

And now there's been a major shake-up at TSA. The acting TSA administrator, Melvin Carraway is out, after embarrassing news, undercover operations designed to test TSA's ability to detect explosives and weapons at airport security checkpoints, yielded a 95 percent failure rate.

CNN has also learned, under cover teams, who smuggled weapons and fake explosives past security, were not weapons experts, security or even law enforcement. They were regular staff with the department of Homeland Security Inspector General's Office.

Now Homeland Security Secretary Jeh Johnson wants screening procedures revised. More training for officers, and screening equipment re- evaluated. The president is urging Congress to confirm his nominee for new TSA administrator. The agency has been without a permanent leader for five months -- John, Christine.

BERMAN: Having a permanent leader might help with some of these organizational issues.

ROMANS: Yes, definitely a leadership issue there.

Takata air bags responsible for the largest recall in history, all the questions the company still can't answer like how to fix the problem, next.

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[05:56:57]

ROMANS: Welcome back. I'm Christine Romans. Let's get an EARLY START on "Your Money" this morning. European stocks look cautious right now. Investors are waiting for the outcome of Greek debt negotiations.

Greece's prime minister will meet with E.U. leaders today. Let's go over a last-minute proposal to avoid default. U.S. stock futures up a little bit here. Yesterday, the Dow fell 28 points.

Takata, the air bag maker still doesn't know exactly what's wrong with the defective air bags. Those air bags have killed at least five people. Thirty four million cars have been recalled.

That's one in every seven cars on American roads recalled because of this issue. After months of testing the company is still isn't sure what is wrong.

Takata is still using a chemical some have blamed for the defect and some of the replacement air bags will need to be replaced again because of a potentially faulty part.

The IRS says it will make the tax filing system more secure by 2016. The 2.7 million taxpayers had their identities stolen last year. It's relatively easy to claim someone else's return. All you need to do is have their Social Security number.

The IRS commissioner testifying yesterday, the agency will team up with tax software companies and state governments to make it harder to steal someone's identity and to steal their tax refunds.

In the meantime, fraud is on the rise and the IRS budget is shrinking. That makes it really difficult to get anyone on the phone, very impatient if you're trying to deal with the IRS.

One viewer tweeted me last night, "I've been calling IRS for two days unable to get rep regarding fraud on my 2014 tax return. Any suggestions?" The response from IRS apparently according to the testimony, John Berman, is, by 2016, things will be better.

BERMAN: Wow, hope you can wait.

ROMANS: Yes. It's really the most important and non-negotiable relationships you have, you and the tax man, except it's a one-way relationship because you can't get to them.

BERMAN: All right. Terror investigations in Boston, new developments overnight, "NEW DAY" starts right now.

(BEGIN VIDEOTAPE)

JAKE TAPPER, CNN HOST, "THE LEAD": A man fatally gunned down by Boston police.

UNIDENTIFIED FEMALE: May have been part of an ISIS terror cell.

UNIDENTIFIED FEMALE: He was making threats to police officers.

WOLF BLITZER, CNN HOST, "THE SITUATION ROOM": The issue of bulk collection of phone data --

SEN. MITCH MCCONNELL (R-KY), SENATE MAJORITY LEADER: No listings of phone calls to law-abiding citizens, none of that is going on.

UNIDENTIFIED MALE: Terrorists aren't going away. America is still their target.

ANDERSON COOPER, CNN HOST, "AC360": A potential major development in the Washington quadruple case.

UNIDENTIFIED FEMALE: Traces of blood from at least one of the murder victims were found.

UNIDENTIFIED MALE: Blood splatter evidence on clothing. That's pretty hard to argue.

UNIDENTIFIED MALE: Violence and deadly crime in some places on the rise.

UNIDENTIFIED MALE: There has been obviously, an uptick in homicides and shootings.

UNIDENTIFIED MALE: People want better policing.

(END VIDEOTAPE)

CUOMO: Good morning. Welcome to your NEW DAY. It is Wednesday, June 3rd, 6:00 in the east. And we do have news of another Boston terror investigation radicalized by ISIS and part of a wider investigation.